Climbing Oil Prices Spike Rise in Eurozone Inflation
The inflation rate in the 17-member Euro bloc rose to 2.7% on the year this past January, the European Union’s stats office said today. Economists had predicted a rise to 2.6%.
The rise comes despite a far-reaching economic recession caused by the current debt crisis, and was attributed to geopolitical tensions out of the Persian Gulf which have caused a jump in oil prices. Iran is currently embroiled in a dispute with the United States and her Western allies regarding the controversial Iranian nuclear program, which the West alleges is for military purposes. The rising tensions have caused oil prices to fluctuate, with Iran cutting of oil shipment to a number of European nations.
Meanwhile, Europe’s economy is struggling to gather strength after shrinking in 2011’s fourth quarter. Oil prices have increased 23% over the past year.
The Euro was not directly affected by the latest inflation data. However, recent gains above 1.3325 have ended a bout of multi-session consolidation and could open the door to the next upside extension.
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